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Bitcoin: virtual cash for transnational payment

Bitcoin is a called into being in the year 2009 virtual cash for transnational payments, which is drawn from all participating clients of the distributed Bitcoin network and managed. This is the first and most widely used, publicly traded, digital currency. Like other crypto currencies also Bitcoins are generated by dissolved computers, cryptographic computing tasks under high computational effort. With Bitcoin, this is a double SHA256 hash function. However, the difficulty of the calculations can always be adjusted by the entire Bitcoin network and regulated.

When a valid solution to the calculation A block is generated, which checks through the entire Bitcoin network at relatively low cost and verified. Each block found is finally assigned to a certain number of Bitcoins, which subsequently or the discoverer (s) of the block is granted to the. Until probably 2017 are the exactly 25 Bitcoins per block. All of the blocks as well as all transactions carried out are recorded in a file stored on each client synchronized database (block chain).

One advantage of cryptographic currencies in general is that the production of the currency – in this case in the form of Bitcoins – not accelerated or may be affected and the resulting institutional independence therefore not (for refinancing with central) banks, corporations, national governments or read the truth other organizations and individuals abused or can be manipulated. For more information about Bitcoin, we recommend the following wiki: https://de.bitcoin.it/wiki/Einführung

Where can I get Bitcoins? Exchange and Mining

Bitcoins can either be directly exchanged and taking into account a conversion rate for another cash or be drawn by the so-called mining using processing power of a computer.

For currency exchange, a large number of commercial space on the Internet (Bitcoin Exchanges), but also more numerous existing Bitcoin machine is suitable.

Prospecting for new Bitcoins are at least in principle normal computer processors (CPUs) in a position, but only a few (kilo) can calculate hashes per second and are therefore not suitable in relation to that was spent time and energy to the mines. In terms of efficiency they are (GPUs) significantly hit by graphics processors, especially current graphics chips Radeon series from AMD have proven particularly computationally strong. However, more than 1000 reviews these are in turn surpassed by specially developed and correspondingly expensive ASICs that can currently boast the highest efficiency in Bitcoin mining.

Because to find a valid block alone, the probability (Solo Mining), is relatively low, crypto currencies are mined usually in groups (Pool mining), where all the participants of such a group ultimately the reward for matching blocks according to the applied computing power divide.

Wallet and transactions – the virtual wallet

To Bitcoins receive, send and to keep, it is necessary first to open a virtual account by means of various software applications in the Bitcoin network, which then a public key (corresponding to an account number) is assigned. To any number of particularly sensitive private keys can (cryptographic strings) are generated by the users with whom signed individual transfers of certain Bitcoin amounts and can be done that way.

This collection of private key is in the form of a file stored in a wallet, so a digital wallet and stored. This private key can theoretically also on data carriers (about USB sticks) or transported for example printed as a string in the form of QR codes or on paper and distributed. Of a payment transaction the payment sender’s public key of the payee must be known. The subsequent signing of individual transactions with a private key can always be verified by the entire network, which makes the offending account, and safeguards the power to dispose of one’s wallet.